Relief, or something like it

It appears I have survived another round of layoffs. 

No one has been fired in two weeks, so I am assuming the bloodbath is over. Unlike last year, no official announcements were made. We do not even know how many people were let go. It really is appalling. 

I often find myself counting the days until my immediate financial goals are met, a favorite distracting reverie. If only I could fast forward my life until next

June -- no debt, $10K cash in the bank. Oh the Freedom. The savings will continue after I reach the mark, of course. But there is something magic about obtaining that first big, round number. 

I do have other things to consider, though.

While I love what I do, I have begun to entertain other career options. There is only so much I am willing to sacrifice to stay in this industry. The worthy employers are becoming fewer in number.

I'm giving myself until next summer to find a job doing the same kind of work, but at a different company. 

If that fails, I will be taking the plunge into a new career. I don't know what that is yet. There is much thinking to do. Switching as I near 40 is not going to be easy, especially since I want to do something that satisfies my mind and heart.

Life is too brief to want to speed through any of it.

Knock, knock

Three weeks after paying off my credit card, the offers for new ones seem to be increasing.

The most amusing letter to date is from American Express. It arrived today, greeting me with the following:

The road to financial success has many milestones marking how far you've come. You've just reached one such milestone. You've been Selected for the American Express Preferred Rewards Green Card.

It also praises my financial record and lists all the benefits I would get with their credit card, including no pre-set spending limit. Yikes!

I have nothing against the company. I just find it ironic given the sacrifices I have made to rid myself of consumer debt. After all, this is the first month in years I received a credit card statement with a zero balance and no interest charges. 

These are the milestones that matters to me.

It is hard for me to imagine any circumstances under which I would get one again given how universally accepted debit cards have become.

The only debt I would consider assuming at this point would be a home loan. I will not be ready for this, though, until I pay everything else off, save a hefty down payment and enjoy living life for a while without ANY loans.

Bach me

My friend, a.k.a. Monkey, mentioned tonight how certain moments in life became sweeter after she began guarding her pennies closely.

She recently treated herself and her beaux to $80 tickets for a performance of J.S. Bach's St. Mathew Passion. The experience, she said, was more intense now that pricey excursions were rare.

It has happened to me, too. At times I feel like my puritan quest to eliminate Debt is in some sense a pursuit for simplicity -- to learn how to consume only what I truly need. It has been a hairy trek since I cling to habits, particularly the bad ones.  Yet it has also has yielded childish joy in what was once mundane.

My example, perhaps a shallow one, will appear tomorrow in the form of a fancy haircut. (I do have pangs of vanity, despite my deprivations of late.) I can't wait for the scalp massage, the free glass of wine and the hour and a half a talented stylist will devote to my beauty. 

It is my reward for slaying my MasterCard. It will also make me look a little less slovenly as I wear jeans and motorcycle boots I to my corporate job.

Granted, her fine work will have to survive another five months. But the bounce it will give promises to last for weeks.

A brighter side

Being an insufferable optimist does have its benefits.

Not only does it balance my inner Eeyore, it softens the blow of disappointments.

Delaying my debt payoff so I can build my emergency fund to $10,000 is such a case. I have been a tad down at having to revise my financial goals to accommodate job uncertainty. So I started researching what I could earn once I hit my savings target. 

Thankfully, my current bank will pay 2.82% APY -- double what I now have -- once I reach the mark. This is almost as much as the rate I pay on my student loan.

So by October I will begin accruing nearly $25 a month in interest income. Not only will this be the most I have ever received on my cash savings, it will ease the pain of prolonging monthly interest payments of about $38 on my student loans.

I may be able to find better deals at other banks, but the convenience of having my checking and savings at the same institution is valuable to me. Transfers immediately appear in my checking account when emergencies arise, and refunding my savings account is just as instantaneous.

Sometimes it is important to take comfort in the little things.

Pardon the interruption

I have been a wayward blogger of late. Please forgive me.

Like much of the country, I became obsessed with the presidential primary races. So when I came home from work, I hopped on the web to read the latest news and developments. This left little time for diary entries on my debt reduction plan.

But with the Democratic battle turning into a war of attrition and the Republican nomination settled, my spare time can now turn back to tracking my financial progress.

And I do have good news to share.

I paid off my credit card! Woo hoo! I have been mentally doing back flips for two weeks now, and I see no signs of this waning.

The amount of pride I feel in accomplishing this -- in seven months -- cannot be under estimated. It reflects mucho sacrifice. I have not had a hair cut in five months. My living room TV remains broken. The CD drive on my computer stands unrepaired. Many social outings have been spurned so I could babysit to earn extra cash. An untold number of beans have been eaten.

I am allowing myself at least one treat to celebrate. I will finally see my hairdresser on Thursday. I will ask her, though, to give me another cut that can endure five months until my next appointment. For I still have much to accomplish.

The week I completely paid off my credit card, the chairman of my company announced another round of layoffs. I have been spared, this time. But who nows how long the reprieve will last. My industry is convulsing, and nothing can be taken for granted.

So I have revised my goals. I originally strove to be debt free by the end of the year. This must now be put on pause while I build up my financial safety cushion. I intend to amass $10,000 in my emergency fund by Oct. 1. The amount is roughly equivalent to six months of living expenses. 

I will continue to make minimum payments on my student loan. After I accumulate the necessary savings, I will return to throwing every spare penny towards this debt. I should have both my student and family loans reduced to zero by Summer 2009.

It hurts to postpone my freedom from debt by another six months. Delayed gratification must apply to this endeavor, too?!

My larger goal, though, is financial stability. Starting next year, my employer will offer severance pay equivalent to one week of pay (instead of two) for every year worked at the company. For me, that means a month's salary should I be axed. That would not sustain me and my two little dogs for very long.

I still love what I do, and I am far from ready to find another vocation. As a result, I must change my ways accordingly to reduce the risk of working in this industry. 

Oh To Be Average

A conversation with my roommate about recession -- whether we were in one -- prompted me to look up the definition on the Federal Reserve Bank's website. As I was searching for it, I came across this chart:

I was stunned. The chart is too old to show what news organizations have recently reported -- that we now have a NEGATIVE savings rate. 

What had turned us into a nation of spenders instead of savers?

The Federal Reserve pointed to studies that show the dip was due to wealthy families saving less of their income because their stock holdings soared in the 1990s. 

I found this to be even more distressing. So I am to assume that relatively poor folks like me typically save next to nothing? Ugh.

I can't wait to be the exception. Although I would be happy if many of my economic kindred bucked the trend with me as well.

Pause

Well, my debt reduction plan is having a bout of hick ups.

I took one of my dogs to the vet for annual shots. I also had to buy a year's supply of this combo flea and heart worm prevention medicine. Cost -- about $240.

Then there is the going away party I agreed to throw for a dear friend and colleague. 

To get rid of the budding flea population in my house and clean a few stains from my sofa, I rented a steam cleaner and bought the requisite supplies. Total cost -- about $40. 

Okay, these expenses can all be justified. 

I did, however, allow myself an indulgence this weekend. I broke down and replaced my living room chair. 

My dogs slowly destroyed it by doing that canine thing where they dig, then circle, before lying down. Over time, they have torn right through the upholstery. I flipped the cushion to prolong its life. After this side met the same fate, I put a used sheet over it. Then another one, to hide the deepening holes in the cushion itself.

So as I cleaned my house the weekend to prepare for the going away party, I took a hard look at my ratty heap of a chair and decided to replace it. 

I did set a limit -- $100. And I lucked out. My favorite used-furniture store had slashed its prices by half to make room for new inventory. I found a lovely white vinyl, mid-century piece that hopefully will be immune to puppy claws. 

As a result, this month my only payment to my credit card will be the $1000 I threw at it last week.

In a perfect world, I would have been able to slice another $500 chunk off the debt mound in a week. 

I shouldn't complain too much, though. Other people have true financial woes befall them -- such as a blown transmission or worse.

Here's hoping a few baby sitting gigs come my way this month, at least enough to cover the chair. 

I think it is time to put the banjo up for sale on Craig's List.